Large, complex risks are common in public sector property portfolios. Kirsteen Kett, client director, public sector practice leader (South) at Aon, highlights some of the current challenges and discusses how to tackle them
A softer property market is making cover more accessible, but insurers remain cautious about some risks. Understanding which areas are challenging, and the steps needed to calm insurers’ nerves, is a must.
Three areas are proving particularly tricky. Major works, whether new buildings or refurbishing existing properties, can be difficult, especially where green materials and more innovative design is used.
Due to the increased fire risk, lithium-ion batteries are also causing local authorities a headache across parts of the property portfolio. Residential properties, due to e-bike and e-scooter charging, and waste management sites, where battery fires are becoming common, require particular attention when securing insurance.
Major works
Whether a new build or a major refurbishment, it’s important to have an eye on the insurance implications before work begins. The push for net zero means that public sector organisations are incorporating more green and sustainable elements in building projects, but these can make insurers twitchy.
Cutting edge materials may meet environmental standards but, without a proven track record, underwriters will err on the side of caution. An example of this is compressed laminated timber (CLT). Although this is great on the green front as it’s sourced from sustainably managed forests and is more environmentally friendly than more traditional materials, insurers are increasingly focused on the potential fire risk associated with this type of construction. Until the risk is better understood, they may ask for enhanced fire protection measures such as upgraded sprinkler systems or they may restrict the amount of cover they provide.
To help avoid future complications and higher premiums, it’s important to think about insurance early in the project. By working closely with your insurance advisers and design team from the outset, you can ensure planned building works are clearly understood and appropriate fire protection and risk controls are built in from day one. This insight enables changes to be made to the design or materials before construction starts. This could potentially save a fortune in insurance costs over the years without necessarily compromising on the green credentials.
E-bike and e-scooter fires
Local authority housing, especially blocks of flats, can be challenging from an insurance perspective. But the popularity of powered micromobility vehicles – more commonly known as e-bikes and e-scooters – is increasing the risk of fire.
E-bikes and e-scooters are powered by lithium-ion batteries. Unfortunately, where a battery fails or a substandard or faulty charger is used, there’s a risk of explosion and fire. When this happens in the home, the fire can spread quickly, putting lives and other properties at risk.
Fire services have reported an increase in these types of fires over the last few years. For example, in 2025, London Fire Brigade attended a record 206 e-bike and e-scooter fires, including two fatalities (1).
It’s a very difficult risk for local authorities to police. Although most will provide safe charging and storage facilities, and ban home charging in the rental agreement, people will still charge these vehicles at home.
Regulation to improve product safety could help. The Product Regulation & Metrology (PRAM) Act, which is awaiting secondary legislation, will hold online marketplaces – where most of the batteries that caused fires were sold – to account for dangerous products sold on their platforms.
For local authorities, demonstrating a robust approach to managing this risk will be essential when it comes to insurance cover. This should include details of fire risk assessments and fire safety measures as well as actions taken to reduce risks around e-bike and e-scooter charging.
Waste site fires
Fires involving lithium-ion batteries make waste management sites a challenging risk for insurers. These fires, which are caused when batteries are crushed or damaged, are common, with research finding there were 1,200 battery fires in the waste system in the year to April 2024 (2).
They’re also difficult to extinguish, causing significant damage and disruption to services. As an example, a battery fire at Elstow Waste Transfer Station last July took six days to extinguish, with the building where it started, declared unsafe and demolished (3).
As insurance claims can run into many million pounds, insurers are nervous with some refusing to cover waste sites altogether. Where cover is offered, it’s normal to see deductibles increased. We’ve also seen insurers refuse to bid for a local authority’s property portfolio if it contains a waste management site.
Consumer education and awareness campaigns can help reduce the number of batteries that end up in the waste system but until more fundamental change, such as detector systems, is introduced, fires will remain a major issue for waste management sites. For authorities looking to secure cover, it may be necessary to remove them from the property portfolio and insure them separately.
More information
To find out more about how we can support you with your property insurance, on both existing and proposed assets, contact Kristeen Kett at [email protected].
(1) Record number of e-bike and e-scooter fires across London in 2025, as Brigade calls for regulation to be introduced | London Fire Brigade
(2) UK Battery Fires Surge 71% to 1,200, Urging Recycling Push (3) Elstow waste site blaze caused by battery, says fire service - BBC News
(3)Elstow waste site blaze caused by battery, says fire service - BBC News
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